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5 Reasons to Have Your Revocable Living Trust Regularly Reviewed

December 16, 2016

John Mangan, Esq.

After setting up a revocable living trust, too many people think that their estate planning is done, once and for all, and can be checked off the list. The fact is, however, that regular reviews of a revocable living trust, and other estate planning documents, are essential. Here are five of the most important reasons you should schedule a review below.

Updates to Tax Codes Impact Revocable Living Trusts

Revocable trusts offer a variety of great tax benefits. The tax code, however, is constantly being changed and updated. If you don’t review and update your revocable living trust to reflect the latest laws, you could be missing out on some very significant tax advantages. If, for example, tax codes are changed to allow higher levels of tax-free gifts, it may make sense to remove assets from a revocable trust and gift them to a loved one now.

Updates to estate tax exemption laws can make a huge difference on how your revocable living trust should be configured. If federal law changes to reduce the estate tax exemption, for example, it may become desirable to put additional assets into the trust to minimize the overall tax burden. Tax code changes can have dramatic effects, which is why it is so important to ensure your revocable living trust reflects the latest changes.

Changes in Life Circumstances Should Be Monitored by Your Trust Administration Attorney

One of the most common reasons a revocable living trust should be updated is because of changes in life circumstances. If you come into a significant amount of extra money, you’ll probably want to add it to your trust. If one of your heirs passes away or you no longer want to include them in the trust, a simple update can be made to reflect these changes. Revocable living trusts are meant to be adjustable over the years, and having them reviewed is the best way to do just that.

Preparing for Long Term Care (Medicaid Planning)

Revocable living trusts provide many great advantages, but protecting assets from the costs of long-term care is not one of them. If you or a loved one may need to go into a nursing home or long-term care facility, it may be time to close out your revocable living trust and open an irrevocable Medicaid trust (or something similar). This can help to protect your estate from the massive costs associated with long-term medical care needs.

Protecting the Portability of a Spouse’s Benefits

Last, but certainly not least, keeping your revocable living trust updated properly can help ensure you take advantage of ensuring the portability of many benefits from one spouse to another. When one spouse passes away, their estate tax applicable exclusion amount can be ported over to the surviving spouse. The surviving spouse can then use it as part of their own estate planning. If the trusts are not updated regularly, however, couples could miss out on this money saving option.

Contact Us for a Revocable Living Trust Review

Having a revocable living trust reviewed is a fairly simple process, and in most cases won’t take too long. Contact The Law Offices of John Mangan, P.A. to schedule a time to get this done.

I’m an attorney in Palm City, FL, and I serve clients throughout Martin County, including Stuart, Palm City, Hobe Sound, and Indiantown, as well as those in St. Lucie County, the Treasure Coast, Palm Beach County, and other parts of Florida.
The Law Offices of John Mangan, P.A., is an innovative firm providing estate planning services to clients in Florida. We focus primarily on wills, trusts, asset protection, guardianship, and probate administration.